March 1, 2000
EConnect Up 80% On Bullish Note From
Newcomer-Company
By K. MAXWELL MURPHY
NEW YORK -- Investors, a large chunk of which were institutional,
wagered heavily on eConnect (ECNC) Wednesday, sending the stock
through the roof for the second straight session after bullish reports on the
company were issued Tuesday and Wednesday, according to Manny
Vavolizza, eConnect's chief information officer.
Shares of eConnect recently traded up 80%, or 2, at 4 1/2. Volume on the
over-the-counter Bulletin Board was 16.6 million shares. Tuesday, the stock
closed up 82% at 2 1/2.
On Tuesday, and again on Wednesday, Mark Ryan, executive vice president
of the as-yet unheard-of Independent Financial Reports Inc., issued
"investment opinion" press releases hyping the stock. In his first note, he
speculated that the stock might be as much as 1200% under-valued.
Ryan's note is Independent Financial's first foray into publicly issued notes,
according to President and Chief Executive Steve Sayre. Independent
Financial previously released "very private circulars" to a "small number" of
investors, Sayre said.
Independent Financial's strategy, Sayre said, is to pick one stock that it
believes is the most undervalued in the market and follow that stock
exclusively until another, more compelling company is found. Sayre believes
eConnect will be a member of the Nasdaq Stock Market in "the very near
future," at which time he thinks Independent Financial will direct its attention
toward another company.
Plans To Spin Off Betting Operations
Before becoming eConnect, the company was called Betting Inc.,
Leggoons Inc. and Handy-Top Inc., and its primary business was providing
gambling services.
Now, according to Vavolizza, the company's focus is broader, and its chief
concern is providing secure Internet transactions.
Banks, according to Vavolizza, are skeptical of the stigma surrounding
gambling. That in mind, he said, the company plans to spin off its betting
operations "in six weeks."
EConnect, of San Pedro, Calif., makes technology that provides "real-time,
one-swipe processes for all forms of financial transactions," Ryan said in his
first note on the company. In theory, Ryan noted, these money-management
tools could improve speed, cost and security of payments and deposits.
"We transport money," Vavolizza said, adding that perhaps the biggest
application of the products would be in securing Internet transactions. With
eConnect's system, a consumer's credit-card information won't get
transmitted over the Internet. Instead, eConnect will act as the middleman
in the deal.
EConnect posted revenue of $40,000 for the nine months ended Sept. 30,
and no revenue in prior years. Vavolizza said the company, which at this
share price is worth more than $170 million, plans to aggressively pursue
revenue and earnings.
-K. Maxwell Murphy, Dow Jones Newswires, 201-938-5173;
maxwell.murphy@dowjones.com |
